Moving toward a Final Resource Adequacy Standard Resource Adequacy Forum Steering Committee Meeting September 27, 2007

Moving toward a FinalResource Adequacy

Standard

Resource Adequacy Forum Steering Committee Meeting

September 27, 2007

September 27, 2007 2

Outline

• Review current standard• Changes that will not alter the

standard• Changes that will alter the standard• Future considerations for the Forum• A look at curtailment events


PNW ResourceAdequacy Standard

• Based on the assumption that the region will tolerate a 1-in-20 year likelihood of a significant curtailment due to lack of supply

• The underlying standard is a 5 percent loss-of-load-probability (LOLP) • The LOLP standard is “translated” into an annual

load/resource balance target to gauge the energy supply

• And into a peak period surplus reserve margin target to gauge the capacity supply


Metrics for the NW Standard

• The choice of metrics is almost arbitrary.

• The metric must show some relationship between resources and loads.

• The adequacy target for the metric is derived from a scenario with a 5-percent LOLP.



• The metric can be the annual, monthly or even hourly difference between loads and resources, calculated from the 5% LOLP scenario.

• It can be portrayed in terms of absolute megawatts or in terms of percent.



• The metric can include a line item for market supplies in the tally of resources, but it doesn’t have to.

• The load is usually based on normal weather, but it doesn’t have to be.

• It can be based on critical hydro, but it doesn’t have to be.


Caveat• Whatever assumptions are used to define the

metric must also be used when evaluating the status of the power supply.

• When one or more of the assumptions in the definition of the metric changes, the underlying standard does not change.

• Updating resource and load data or improving the simulation program does not change the standard.

• Under any of these cases, real life resource acquisition decisions will not be altered.


What can change the Standard?

• Any change in assumptions that alters the underlying 5 percent LOLP will change the standard.

• Examples include:• The definition for a significant energy event.• The definition for a significant capacity event.• The months over which events are counted.• Adding or subtracting random variables to the

simulation.• Directly changing the 5 percent target to something

else.


Adequacy Forum’s Charge• The Forum is charged with reevaluating the

energy and capacity targets each year.• As conditions change, the targets may

change but the underlying standard remains intact.

• The Forum is also charged with reviewing the underlying 5 percent LOLP standard and altering it if appropriate.

• Altering the LOLP standard will change resource acquisition actions.


Future Considerations that may change the

Standard• The definition for a significant energy event.• The definition for a significant capacity

event.• Consider using all months of the year.• Consider calculating a single LOLP instead of

a separate energy and capacity LOLP.• Should only “bad” years be counted or

should the LOLP be based on bad events?• Review the 5 percent LOLP target.


January 1930

-5000

0

5000

10000

15000

20000

25000

30000

35000

40000

45000

1 27 53 79 105

131

157

183

209

235

261

287

313

339

365

391

417

443

469

495

521

547

573

599

625

651

677

703

729

Hour in Month

Meg

awat

ts

Net Demand NW Thermal NW Hydro Unserved Net Imports

Cold

Hydro Limited

GENESYS Simulation Illustrative Example Only


Curtailment Events(Peaking problems and energy shortages)

0

1000

2000

3000

4000

Hourly Curtailments Dec-Apr (Not all hours shown)

Curt

aile

d M

egaw

att

s

Peak Event > 3,000 MW

Energy Event > 28,800 MW-hrs

Each event has a peak and duration.


Curtailment EventsL/R Bal approximately -1,500 aMW

Curtailment Events - LOLP = 4%Capacity LOLP = 0% ???

0

1000

2000

3000

4000

5000

6000

1 2 2 2 2 2 2 9 9 9 9 9 9 9 9 9 9 9 27 27 41

Cu

rta

ilme

nt

(MW

)

Game 2

Game 9

This is a scenario that is just adequate for energy needs.


Curtailment EventsL/R Bal approximately -2,000 aMW

Or, 500 aMW higher load than @energy target

Curtailment Events - LOLP = 10%Capacity LOLP 6% ???

0

1000

2000

3000

4000

5000

6000

1 2 2 2 2 2 2 2 2 2 2 8 8 8 8 8 8 8 8 8 8 8 8 8 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 2727 27272727 272741

Cu

rta

ilme

nt

(MW

)

Game 2

Game 9

Game 27

Game 2 Game 9Game 8 Game 27 Game 41


Additional Slides


Energy Metric Assumptions

• Averaged over all hours of the year • Load is based on normal weather and

includes net interregional firm contracts• Resources include

• In-region spot market (uncommitted IPPs)• Critical-year hydroelectric generation• A 1500 MWa planning adjustment (derived

from the LOLP analysis) accounting for out-of-region spot markets and non-firm hydro generation


Capacity Metric Assumptions

• Averaged over the peak load duration hours• Load is based on normal weather and

includes net interregional firm contracts • Resources include

• In-region spot market (uncommitted IPPs) • Critical-year hydroelectric generation• A planning adjustment accounting for out-of-

region spot markets and non-firm hydro generation


Resource Assumptions• In-region spot market (uncommitted

IPPs)• Nov-May full IPP capability• Jun-Oct 1,000 MW only

• Out-of-region spot market• Nov-May 3,000 MW • Jun-Oct 0 MW

• Non-firm hydro and hydro flex• Nov-May 2,000 MW • Jun-Oct 1,000 MW


Targets for the NW Standard

• Targets are set so that the resulting Loss-of-Load Probability (LOLP) is 5 percent

• Energy – zero, that is, annual average loads and resources should be in balance

• Capacity• 25 percent for winter months• 19 percent for summer months

Documents

Moving toward a Final Resource Adequacy Standard Resource Adequacy Forum Steering Committee Meeting September 27, 2007